#kelpdao exploit

[rwatimes]

All about Aave’s new ‘risk framework’ after April’s $290 mln exploit

This follows 2 months after the famous and biggest KelpDAO rsETH exploit that exposed the loopholes in the DeFi ecosystem.

➤ Aave founder Stani Kulechov has introduced a new risk framework in response to a $290 million exploit. ➤ The framework includes four layers: Asset Risk, Bridging Risk, Automated Risk Oracles, and Chain Risk, aiming to enhance security and monitoring. ➤ Assets not meeting the new standards will be removed from Aave, impacting its TVL and market position.

[rwatimes]

Aave proposes new framework setting stricter standards after KelpDAO exploit

➤ Aave proposes a new, multi-layered risk framework to enhance asset listing and monitoring standards across its V3, V4, and Horizon protocols. ➤ The framework, prompted by the KelpDAO exploit, introduces stricter requirements for asset risk, bridge exposure, automated monitoring, and chain deployments. ➤ It aims to mitigate risks associated with collateral assets, bridge configurations, and off-chain infrastructure through continuous due diligence and faster defensive mechanisms.

[rwatimes]

Aave Proposes Protocol-Wide Risk Framework After KelpDAO Exploit

➤ Aave is considering a comprehensive protocol-wide risk framework and an upgrade to its Pendle PT risk oracle following the KelpDAO LayerZero exploit. ➤ The proposed four-layer framework will assess Asset Risk, Bridging Risk, Monitoring, and Chain Risk, with non-compliant assets being removed from the platform. ➤ The oracle upgrade aims to transition to protocol-owned infrastructure on Chainlink CRE for enhanced transparency and security.

[rwatimes]

Strategy’s BTC Sale, DeFi Recovery & Tokenized RWAs

➤ Q2 2026 saw a volatile crypto market influenced by macro factors and a significant Bitcoin sale by Strategy, impacting lending markets and basis trades. ➤ The KelpDAO exploit caused a major DeFi TVL drop, but the ecosystem demonstrated resilience through coordinated crisis management and recapitalization efforts. ➤ Tokenized RWAs, particularly equities, gained momentum due to regulatory engagement and offered a more stable alternative to leveraged crypto strategies.

[rwatimes]

ZachXBT Exposes US Law Firm Gerstein Harrow's $71M Grab of Stolen Lazarus Funds

Onchain investigator ZachXBT has accused U.S. law firm Gerstein Harrow LLP of filing fraudulent claims over frozen crypto assets linked to North Korea’s Lazarus Group, a tactic he says

➤ Onchain investigator ZachXBT has accused US law firm Gerstein Harrow LLP of filing fraudulent claims over $71M in frozen crypto assets linked to North Korea's Lazarus Group. ➤ The law firm is attempting to seize these funds based on an unrelated 2015 judgment, potentially harming actual victims of the recent KelpDAO exploit. ➤ ZachXBT has proposed a community DAO to counter the firm legally, as recovery for victims remains blocked by this legal maneuver.

[rwatimes]

How do exploits like KelpDAO affect overall DeFi liquidity and user trust?

➤ The KelpDAO exploit resulted in a $13 billion DeFi liquidity drain and severely damaged user trust by exposing hidden centralization in supposedly decentralized systems. ➤ Exploits trigger capital flight, reduce DEX liquidity, and increase slippage, making the ecosystem inhospitable for institutional capital and leading to regulatory scrutiny. ➤ While exploits are devastating, collaborative recovery efforts and a shift towards intent-alignment monitoring are helping to rebuild trust and strengthen the DeFi ecosystem.

[rwatimes]

‘Precautionary’- Wrapped Bitcoin (wBTC) tightens security after KelpDAO $293M exploit

Wrapped Bitcoin is upgrading its cross-chain security and pausing certain transfers to prevent a KelpDAO-like breach...

➤ Wrapped Bitcoin (wBTC) is enhancing its cross-chain security protocols and temporarily pausing certain transfers following the KelpDAO exploit. ➤ The upgrades are a precautionary measure against similar Decentralized Verification Network (DVN) vulnerabilities that led to a $293 million loss at KelpDAO. ➤ Despite broader DeFi outflows, wBTC has shown resilience with net inflows, highlighting its critical role and the potential systemic risk of an exploit.

[rwatimes]

Circle Proposes Emergency Rate Changes to Unstick Aave's Frozen USDC Pool

Circle has proposed an emergency overhaul of the interest rate parameters on Aave V3 Ethereum Core's USDC pool, which has been pinned at 99.87% utilization for four days in the wake of the April 18 KelpDAO exploit.

➤ Circle has proposed emergency interest rate changes for Aave's USDC pool due to a KelpDAO exploit causing a liquidity crunch. ➤ The stablecoin issuer argues current borrowers are using USDC as an exit mechanism, and higher yields are needed to attract supply. ➤ The proposal includes pausing Aave's Risk Oracle for USDC due to past underperformance and maintainer issues.